Hamilton Mayor John Bencivengo is charged with extorting bribe over school insurance contract

Hamilton Mayor John Bencivengo is charged with taking bribesHamilton Mayor John Bencivengo appeared briefly in court this morning to face charges he solicited and received $12,400 in bribes from a health insurance broker for his influence in securing a no-bid school district contract. His attorney Jerome Ballarotto said his client is innocent following an initial court appearance today.

HAMILTON — Hamilton Mayor John Bencivengo appeared in federal court yesterday on charges he traded his public influence as mayor for $12,400 in bribes from a school health insurance broker he promised to help in securing a no-bid contract.

Bencivengo, 58, is charged with one count of attempted extortion and made his first appearance in federal court shortly before noon yesterday after surrendering to FBI agents at 8:30 a.m. He faces up to 20 years in prison if convicted of the extortion charge.

The recently re-elected Republican mayor of the state’s ninth largest municipality, Bencivengo did not plead to any charge, but appeared briefly before U.S. Magistrate Judge Douglas E. Arpert and was released on $100,000 unsecured bail. A follow-up hearing has yet to be scheduled.

Wearing a black suit, white shirt and leg irons and accompanied by attorney Jerome Ballarotto, Bencivengo spoke little at the hearing, offering only responses such as “Yes, your honor,” in answer to the judge’s questions.

The hearing was over in less than 10 minutes. The judge told Bencivengo he cannot leave New Jersey without permission. He must also surrender his passport and is barred from speaking to any witnesses in the case.

Surrounded by throngs of reporters and cameras as he exited the East State Street courthouse yesterday, Bencivengo made no comment and left in a red Corvette driven by his attorney.

Ballarotto said the mayor has not resigned from his elected position, for which he is paid $108,211, and does not intend to step down.

“The mayor has not resigned and the mayor will consider his options but at the moment I don’t think he’s going to resign,” he said.

Bencivengo will fight the federal charges and eventually plead not guilty if and when he is indicted by a grand jury, the attorney said.

“He’s not guilty,” Ballarotto said. “The charges are he committed extortion, that he took money in exchange for official acts, and he did not.”

The Times last week was the first to report that Bencivengo was the target of a federal probe, unleashing a tidal wave of speculation across the township and in Bencivengo’s political circles.

The federal complaint unsealed yesterday paints a portrait of a man floundering with money troubles.

Faced with difficulties paying his taxes and bills, the complaint states Bencivengo turned to a school insurance broker for money in exchange for his sway over a Hamilton school board member preparing to vote to renew the broker’s contract. The broker was identified by the federal authorities as the cooperating witness.

In May, Bencivengo and the witness met in Hamilton, according to the complaint. He and the witness agreed to an initial payment of $5,000 in exchange for Bencivengo’s influence over the contract renewal. The initial payment was passed through an intermediary, who cashed the check. The intermediary then made a series of payments from $500 to $1,000 over several weeks, the complaint said.

Bencivengo told the intermediary to pretend, if asked, the check was for the purchase of a bedroom set.

In a July 11, 2011, conversation recorded by the witness, Bencivengo said he received payments in increments of $500 and $1,000 over the previous few weeks.

Bencivengo also received $7,400 in cash in two payments from the witness later in July, the complaint said.

Representatives from the U.S. Attorney’s Office in New Jersey and the FBI declined to identify the cooperating witness, citing an ongoing investigation.

A source with knowledge of the investigation identified the cooperating witness as Marliese Ljuba, who works for Vineland-based Allen Associates. The source was not authorized to speak on the record.

Ljuba did not return calls seeking comment. She and Robert Ljuba, who share the same address, have donated $7,400 to Bencivengo, and county and township Republican committees since 2007, according to campaign finance records.

Ballarotto said the witness was wearing a wire and a camera, and expressed confidence any taped recordings would exonerate the mayor.

“It doesn’t concern us in the least,” he said about the recordings. “The more technology they used, the more they recorded what happened, the more we like it.

The informant, we hope, recorded every single word that happened.”

“Hopefully every thing that transpired between this informant and the mayor that was recorded will demonstrate there was no extortion,” he continued.

A spokeswoman for the U.S. attorney would not say whether more arrests are imminent.

The Bencivengo probe was initiated last spring, at a time when federal and state authorities were sweeping up the state-requested documents related to contracts between local governments and insurance brokers, according to subpoenas and an official.

The documents suggested authorities were taking a probing look at the relationships between public officials and the insurance brokers who manage millions of dollars worth of policies for government employee health benefits, workers’ compensation and other government liabilities.

“Today, the sitting mayor of Hamilton Township is charged with promising to use his influence over the Hamilton Board of Education in exchange for bribes,” U.S. Attorney Paul J, Fishman said. “This is the most recent public example of a public official charged by this office with extortion or bribery in connection with brokering insurance contracts for public schools. These lucrative service contracts should not be opportunities for public servants to betray their constituents by enriching themselves or their colleagues.”

Ballarotto also represented former Toms River superintendent Michael Ritacco, who admitted to accepting $2 million in bribes as part of a guilty plea on charges of mail fraud and conspiracy to impede and impair the Internal Revenue Service.

Bencivengo was sworn in to his second term as Hamilton mayor in January after coasting to re-election in November. He defeated incumbent Mayor Glen Gilmore in 2007 in a narrow victory for his first term, which also ushered in four years of Republican rule in the township with an all-GOP council.

Hamilton Republicans frequently asked for state and federal investigations into Gilmore, whom Bencivengo and his administration painted as fiscally irresponsible at best and criminal at worst, a charlatan who misspent and lost millions of dollars.

Before the 2007 election, Bencivengo was the Hamilton Township Republican Party chairman. He had also served from 1996 to 2004 as the executive director of the Hamilton Partnership, a public/private economic development group.

He is a current vice president with the New Jersey Conference of Mayors. Bencivengo has lived in Hamilton for nearly 40 years and before taking over as full-time mayor, owned a string of small businesses, including vitamin, landscaping and construction companies.

Staff writer Alex Zdan and Jim Cook Jr. of the News of Cumberland County contributed to this report.